It's Time To Get Your Financial House In Order

Now that fall is upon us and the kids are back to school (even if you dread it), it's important to set aside some time to sort through your finances, evaluate your financial situation and consider ways to make improvements and simplify your life in the process. This may not be your favorite thing to do, but before you know it, the end of 2015 will be here. If you take some conscious steps in the next few months, you can potentially save money on taxes, get your financial house in order and stay fiscally on track.

First things first – What are your financial priorities? As the years pass, life happens and the many twists and turns that we all experience can have a big impact on your decisions when it comes to where you spend and save your money. Things that were important to you and your family a few years ago may be completely irrelevant today. And, if you're like most folks, your financial resources and plans likely did not keep up with these changes. Here are some questions that can help identify financial issues you may want to address over the next few months:

Have you recently experienced any life-changing events, such as marriage or divorce, the birth of a child, the passing of a loved one, retirement, or a career change? These events all have financial repercussions and will most likely have an impact on your priorities and financial situation. There are many resources available for you to research these topics on the web and you should consider speaking with a financial professional for some guidance.

Pay Bills Automatically (and free up your mind and time for other, more enjoyable pursuits). Signing up to have your bills paid automatically from your bank account will save you the hassle of writing monthly checks and worrying about mail delivery, or remembering to pay them online every 30 days. Automatic bill pay gives you peace of mind and helps to avoid costly missed due dates. Did you know that some credit card companies will boost interest rates beyond 31 percent and charge late fees of nearly $40 after just one late payment? No kidding.

Have you managed to save as much as you expected this year? If you're like many of us, the answer is a resounding "no." To help catch up, consider putting this part of your life on autopilot by establishing a systematic savings plan. The goal is to consistently put aside some extra money every month with the goal of improving your financial situation. For some, this may mean adding to your retirement account or your child's college savings plan, or maybe shoring up a rainy day fund. Whatever it is, saving a few extra dollars every month or increasing your investment contributions just a little bit can make a huge difference over time.

Are you comfortable with the amount of debt that you have? The best thing you can do to improve your financial health is eliminate high-interest debt. Period. Try to use any bonus, raise or tax refund to pay off credit cards in full. Even adding a few hundred dollars to your payments can have a significant impact, especially if you can get your credit card company to lower your rate. Did you know that many companies will lower your rate if you just ask. As long as you've been current for a while, they would rather reduce your rate than lose you as a customer. So give them a call, because one thing is for sure – they're not going to reach out to you to reduce your rate. Take control. And then…

Take another look at your taxes (yes, really). Completing an estimate of your tax liability may reveal some tax planning opportunities. Use last year's tax return as a basis, then make any anticipated adjustments to your income and deductions for this year. You'll want to check your withholding or estimated payments, especially if you owed taxes when you filed last year's income tax return or if you received a large refund. Doing that now, rather than waiting until the very end of the year, may help you avoid a big tax bill (ouch) or having too much of your money tied up with Uncle Sam (not a good thing either). If necessary, adjust the amount of federal or state income tax withheld from your paycheck by filing a new Form W-4 with your employer.

Set up a system. To help avoid missed tax-saving opportunities for the year (always desirable), one basic thing you can do right now is set up a system for saving receipts and other tax-related documents. This can be as simple as dedicating a folder in your file cabinet to this year's tax return so that you can keep track of important paperwork. Such a simple way to reduce the stress of tax time.

Review and identify your insurance needs. Consider these important questions: Do you have the policies that your current life situation warrants? Do you know exactly how much life and disability insurance coverage you have? Are your beneficiaries on those policies up to date? Are you familiar with the terms of your homeowners, renters and auto insurance policies? If not, it's time to add your insurance policies to your fall reading list. Insurance needs change frequently, and it's possible that your coverage hasn't kept pace with your income or family circumstances.

I've always liked this quote from Robert Kiyosaki; "It's not how much money you make, but how much money you keep, how hard it works for you, and how many generations you keep it for". There are many resources available to you on the web as you work through each key area, and it's always a good idea to seek the guidance and advice of a professional.